Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what assessment he has made of the effect of mortgage holidays taken during the covid-19 outbreak on the credit ratings of mortgage prisoners.

Following the Coronavirus outbreak, the Government worked quickly with lenders and financial regulators to give people access to payment holidays on their mortgages. This gives customers a much-needed respite period, where no repayments on these products are due. It was necessary to bring this temporary measure in, in order to give customers time to smooth out their finances that may have taken a hit by the pandemic.

The FCA issued guidance to all firms that engage in mortgage activities, this includes all borrowers whose mortgage is in a closed book or owned by an inactive lender.

We were clear from the start, that anyone taking a one of these payment holiday should not suffer a worsening arrears status.